Interim Results

T42 IOT Tracking Solutions PLC

30 September 2026

 

30 September 2026

t42 IoT Tracking Solutions Plc

(“t42”, the “Company” or, together with its subsidiaries, the “Group”)

Interim Results

t42 IoT Tracking Solutions plc (AIM: TRAC) (“t42” or the “Company”), which provides real-time tracking, security, and monitoring solutions for the global supply chain, logistics, container, and freight market, announces its unaudited results for the six months ended 30 June 2026.

Financial Highlights

Revenue increased 51.4% to $3.48m (H1 2025: $2.29m), mainly due to increased demand for the Lokies product.

Gross profit increased 11.2% to $1.21m (H1 2025: $1.09m), due to an increase in revenue.

The Company’s outstanding convertible loan notes subscribed by A-labs have been paid down by 33.45% since 30 June 2025, leaving $0.98m outstanding as at the date of this announcement.

Cash and cash equivalents as of 30 June 2026 increased to $0.45m (30 June 2025: $0.21m).

Working capital (“WC”) improved significantly by $2.26m to a negative WC of $2.25m (30 June 2025: A negative WC of $4.51m).

Operational and Strategic Highlights

Next-generation Lokies: The Company is developing an advanced new version of the Lokies smart lock, scheduled for launch in H2 2027. It is expected to represent a significant leap forward across all performance parameters compared with the current version.

New software launch and entry into the consumer (B2C) market: New Lokies software expected to be launched in the coming weeks, marking the first phase of the Company's strategy to enter the consumer market, which offers substantial growth potential.

Increased investment in innovation: R&D investment rose 53.5% to $0.19m (H1 2025: $0.13m), strengthening the Group's technological edge.

Avi Hartmann, CEO of t42, commented:

“I am delighted with our recent performance, achieving over 50% revenue growth against the prior year comparable period, driven by an 85% increase in hardware sales, a doubling of our cash position, and a substantially improved debt structure. With the next generation of Lokies scheduled for launch in H2 2027 and our imminent planned entry into the consumer market, we enter the next phase of our journey confident in our ability to accelerate growth and deliver lasting value to our shareholders.”

Contacts:

t42 IoT Tracking Solutions Plc Michael Rosenberg, Chairman Avi Hartmann, CEO	07785 727595 [phone]
Strand Hanson Limited (Nominated Adviser and Financial Adviser and Broker) James Harris / Richard Johnson / Imogen Ellis	020 7409 3494
Walbrook PR Ltd (Media & Investor Relations) Nick Rome / Marcus Ulker	Tel: [phone]  or [e-mail]

The Interim Report will be made available to shareholders shortly and be available from the Company’s website at: www.t42.co.uk.

CHAIRMAN’S STATEMENT

The first half of 2026 has marked a genuine step-change for the Company, with commercial, operational, and financial achievements that strengthen our position as a leading provider of supply chain monitoring and security solutions worldwide.

Strong Growth in Lokies Sales

One of the clearest indicators of the transformation underway is the growth in Lokies sales. In the first half of 2026, sales rose sharply to 10,550 units, more than double the 5,000 units we sold in the corresponding period in 2025. This not only drives immediate hardware revenue but also lays the foundation for ongoing SaaS subscription income.

Accelerated Product Development – Expanding the Portfolio

The Company continued to invest in the development of its IoT platform and product portfolio, improving capabilities across hardware, firmware, software and customer applications.

During the period, t42 advanced the development of new Kylos solutions, including Kylos MC, a rechargeable tracking device with USB-C charging and built-in temperature and humidity sensors, and Kylos Label, a disposable tracking solution designed to provide simple and efficient real-time visibility for shipments, assets and goods in transit, particularly for one-time shipments, pilot projects and temporary logistics operations.

The Company also continued to enhance its existing solutions, including improvements to the t42 Online platform, device management, monitoring, reporting and system reliability. In addition, development progressed on the Lokies B2C mobile application, which is expected to be released during H2 2026, providing customers with improved access, monitoring and management capabilities for connected security devices.

These developments support t42’s strategy of delivering integrated IoT solutions for supply chains, logistics, fleet management and asset protection, while expanding opportunities for recurring software and connectivity revenues.

OUTLOOK

We closed the first half of 2026 with strong momentum, supported by major contracts, improved liquidity, an expanded product range approaching commercial launch, and growing global demand for our solutions. Our team remains fully focused on driving further expansion and delivering results that will strengthen the Company’s position and create lasting value for our shareholders.

The second half of the financial year has begun well, and we look forward to reporting further progress in the coming months.

Michael Rosenberg OBE

Non-Executive Chairman

T42 IOT TRACKING SOLUTIONS PLC

UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2026

T42 IOT TRACKING SOLUTIONS PLC

UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL

STATEMENTS

JUNE 30, 2026

INDEX

	UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:	PAGE
	Independent Auditors’ report on review of interim financial information	7
	Interim Condensed Consolidated Statements of Financial Position	8
	Interim Condensed Consolidated Statements of Comprehensive Loss	9
	Interim Condensed Consolidated Statements of Changes in Deficit	10
	Interim Condensed Consolidated Statements of Cash Flows	11
	Notes to the Interim Condensed Consolidated Financial Statements	12-19

Review Report of Independent Auditors

Introduction

We have reviewed the accompanying condensed consolidated interim statements of financial position of t42 IoT Tracking Solutions PLC and its consolidated companies (hereinafter - "the Group") as of June 30, 2026 and the related condensed consolidated interim statements of comprehensive loss, changes in shareholders' equity and cash flows for the six months then ended. Preparation and presentation of these condensed consolidated financial statements in conformity with International Accounting Standard No. 34 "Interim Financial Reporting" are the responsibility of the Group's board of directors and management. Our responsibility is to express a conclusion on these interim consolidated financial statements based on our review.

Scope of Review

We conducted our review in accordance with Review Standard (Israel) No. 2410 of the Israel Accounting Standards Board, "Review of Interim Financial Information for Interim Periods Performed by the Auditor of an Entity". A review consists principally of inquiries of Company personnel, analytical procedures applied to the financial data and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, we are not aware of any material modifications that should be made to these interim consolidated financial statements in order for them to be in conformity with International Accounting Standard No. 34. Without qualifying our Conclusion, we draw attention to the Group's business situation. As of June 30, 2026 the Group has accumulated losses of $19 million from operations since inception and has a working capital deficit of $2.25 million and loans totaling $2.8 million to be repaid or converted within the next 18 months. At the date of approval of the financial statements, the Company's management prepared forecasts of the Group's expected cash flows from its business for the foreseeable future. Based on these forecasts, the Company and its subsidiaries are expected to able to continue their operations and meet their existing and expected financial liabilities for next 12 months.

Shtainmetz Aminoach & Co. Certified public accountants (Israel) A member of UHY worldwide                                                                                                                                                     Tel Aviv,                                                                                                                                                     September 29, 2026

T42 IOT TRACKING SOLUTIONS PLC

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

U.S. Dollars in thousands

		June 30				December 31
	Note	2026		2025		2025
		Unaudited		Unaudited		Audited
ASSETS
NON-CURRENT ASSETS :
Properties, plant and equipment		230		301		254
Rights-of-use assets		749		919		840
Intangible assets		518		669		591
Trade receivables		-		72		18
Bank deposit		-		10		10
Total Non-Current Assets		1,497		1,971		1,713
CURRENT ASSETS :
Cash and cash equivalents		454		207		571
Trade receivables		451		649		585
Other accounts receivable		102		235		88
Inventory		458		868		856
Total Current Assets		1,465		1,959		2,100
TOTAL ASSETS		2,962		3,930		3,813
DEFICIT AND LIABILITIES
DEFICIT		(3,132)		(3,254)		(2,939)
NON-CURRENT LIABILITIES:
Leasehold liabilities		713		717		715
Amortized cost of loans	4	1,670		-		2,059
Total Non-Current Liabilities		2,383		717		2,774
CURRENT LIABILITIES:
Short-term bank credit		52		70		94
Current maturities of long-term bank loans		-		55		15
Trade payables		313		799		726
Other accounts payable		811		1,248		1,032
Current maturities of leasehold liabilities		160		209		187
Financial liabilities in fair value	4	291		9		249
Current maturities of amortized cost of loans		930		3,139		666
Related parties	5	1,154		938		1,009
Total Current Liabilities		3,711		6,467		3,978
TOTAL DEFICIT AND LIABILITIES		2,962		3,930		3,813

The accompanying notes are an integral part of the interim condensed consolidated financial statements.

September 29, 2026
Date of Approval of the Financial Statements		Aviran Sabag CFO		Avi Hartmann CEO

T42 IOT TRACKING SOLUTIONS PLC

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

U.S. Dollars in thousands

			Six Months Ended June 30				Year Ended December 31
	Note		2026		2025		2025
			Unaudited		Unaudited		Audited
Revenues			3,471		2,293		6,100
Cost of revenues	6		(2,257)		(1,201)		(3,276)
Gross profit			1,214		1,092		2,824
Operating expenses:
Research and development			(195)		(127)		(349)
Sales and marketing			(210)		(192)		(389)
General and administrative expenses			(1,311)		(918)		(1,722)
Other income (expenses), net			44		(52)		8
			(1,672)		(1,289)		(2,452)
Operating profit (loss)			(458)		(197)		372
Finance income			1		229		325
Finance expenses			(431)		(923)		(1,273)
Net finance Income (expenses)	7		(430)		(694)		(948)
Total comprehensive loss for the year			(888)		(891)		(576)
Loss per share:
Basic and diluted loss per share (in dollars)	3		(0.012)		(0.014)		(0.009)

The accompanying notes are an integral part of the interim condensed consolidated financial statements.

T42 IOT TRACKING SOLUTIONS PLC

INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

U.S. Dollars in thousands

	Share Capital *		Premium on Shares			Capital Reserve		Reserve from Share-Based Payments		Accumulated Loss			Total
(Unaudited)
Balance as of January 1, 2026	-		13,862			89		1,258		(18,148)			(2,939)
Issuance of share capital  (1)	-		203			-		-		-			203
Share-based payment (2)	-		-			-		492		-			492
Comprehensive loss for the period	-		-			-		-		(888)			(888)
Balance as of June 30, 2026	-		14,065			89		1,750		(19,036)			(3,132)
See note 5(h)       See note 5(d,e,f, i)
(Unaudited)
Balance as of January 1, 2025	-		13,543			89		1,258		(17,572)			(2,682)
Issuance of share capital, net of expenses	-		319			-		-		-			319
Comprehensive loss for the period	-		-			-		-		(891)			(891)
Balance as of June 30, 2025	-		13,862			89		1,258		(18,463)			(3,254)
(Audited)
Balance as of January 1, 2025	-		13,543			89		1,258		(17,572)			(2,682)
Issuance of share capital, net of expenses	-		319			-		-		-			319
Comprehensive loss for the year	-		-			-		-		(576)			(576)
Balance as of December 31, 2025	-		13,862			89		1,258		(18,148)			(2,939)

              * An amount less than one thousand.

The accompanying notes are an integral part of the interim condensed consolidated financial statements.

T42 IOT TRACKING SOLUTIONS PLC

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

U.S. Dollars in thousands

		Six Months Ended June 30				Year Ended December 31
		2026		2025		2025
CASH FLOWS FROM OPERATING ACTIVITIES:		Unaudited		Unaudited		Audited
Loss for the year		(888)		(891)		(576)
Adjustments for:
Depreciation and amortization		198		232		466
Financial expense, changes in fair value of financial liabilities      and exchange rate differences, net		230		418		420
Share-based payment expenses		492		-		-
Gain from modification of debt terms		-		-		-
Intangible assets impairment		-		-		-
Changes in assets and liabilities:
Decrease in inventory		398		249		261
Decrease in trade receivables		152		155		273
Increase in other receivables		(15)		(149)		(2)
Decrease in trade payables		(197)		(308)		(380)
Increase (Decrease) in other accounts payable		(221)		179		(38)
Net cash provided by (used in) operating activities		149		(115)		424
CASH FLOWS FOR INVESTING ACTIVITIES:
Purchases of property and equipment		-		(1)		(1)
Decrease (Increase) in deposits		10		-		-
Net cash provided by (used in) investing activities		10		(1)		(1)
CASH FLOWS FOR FINANCING ACTIVITIES:
Increase (Decrease) in short-term bank credit, net		(42)		(3)		26
Proceeds from related parties, net		28		27		51
Payment of leasehold liability		(115)		(107(		(210)
Repayment of loans		(147)		(60)		(185)
Consideration of the issue of shares, net		-		319		319
Net cash provided by (used in) financing activities		(276)		176		1
Increase (Decrease) in cash and cash equivalents		(117)		60		424
Cash and cash equivalents at the beginning of the period		571		147		147
Cash and cash equivalents at the end of the period		454		207		571
Additional Information
Interest paid during the period		165		148		358

The accompanying notes are an integral part of the interim condensed consolidated financial statements.

T42 IOT TRACKING SOLUTIONS PLC

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. Dollars in thousands

NOTE 1 -

GENERAL INFORMATION

	The Reporting Entity
		t42 IoT Tracking Solutions PLC ("the Company") was incorporated in Jersey on November 28, 2012. The Company and its subsidiaries ("the Group") is a global supplier in the field of advanced, automated real-time systems, specializing in the remote tracking and management of vehicles, containers, and assets. The Company fully owns t42 Ltd., an Israeli company, and Starcom Systems Limited, a company incorporated in Jersey. The Company's shares are admitted to trading on the AIM market of the London Stock Exchange. The address of the official Company office is in Israel at t42 IoT Tracking Solutions offices, which are located at 96 Dereh Ramatayim Street, Hod Hasharon, Israel. The address of the Company’s registered office is at Starcom Systems Limited offices, which is: Forum 4, Grenville Street, St. Helier, Jersey, Channel Islands, JE4 8TQ.

	Company’s financial position:
		As of June 30, 2026, the Company has a deficit in capital and working capital amounting to approximately $3.13 million and $2.25 million, respectively. In addition, during the 6-month period ended June 30, 2026, the Company incurred an operating loss in the amount of $0.46 million. The Company's management has prepared cash flow forecasts, which take into account the Company's estimates of sales growth, based on existing engagements, the Company's operating expense structure, and its financial liabilities and financing resources. Based on these forecasts, the company's management estimates that it will be able to meet all of its existing and future obligations in the foreseeable future and that it will be able to continue its operations in its current format.

c.	Exchange rates:
		As of June 30				As of December 31
		2026		2025		2025
	Exchange rate of NIS in U.S. $	0.336		0.297		0.313
	Exchange rate of GBP in U.S. $	1.323		1.371		1.345
		Six Months Ended June 30				Year Ended December 31
		2026		2025		2025
	Change in Exchange Rate of U.S. $	7.35%		8.39%		14.23%
	Change in Exchange Rate of GBP	(1.64)%		9.33%		7.26%

 

 

T42 IOT TRACKING SOLUTIONS PLC

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. Dollars in thousands

NOTE 2 -

BASIS OF PREPARATION AND CHANGE IN THE GROUP’S ACCOUNTING POLICIES

a.	Basis of preparation
b. c.	The interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles for the preparation of financial statements for interim periods, as prescribed in International Accounting Standard No. 34 ("Interim Financial Reporting"). The interim consolidated financial information should be read in conjunction with the annual financial statements as of December 31, 2025 and for the year ended on that date and with the notes thereto. The significant accounting policies applied in the annual financial statements of the Company as of December 31, 2025 are applied consistently in these interim consolidated financial statements. New standard yet adopted IFRS 18, Presentation and Disclosure in Financial Statements This standard replaces IAS 1, Presentation of Financial Statements. The purpose of the standard is to provide improved structure and content to the financial statements, particularly the income statement. The standard includes new disclosure and presentation requirements that were taken from IAS 1, Presentation of Financial Statements, with small changes. As part of the new disclosure requirements, companies will be required to present two subtotals in the income statement: operating profit and profit before financing and taxes. Furthermore, for most companies, the results in the income statements will be classified into three categories: operating profit, profit from investments and profit from financing. In addition to the changes in the structure of the income statements, the standard also includes a requirement to provide separate disclosure in the financial statements regarding the use of management-defined performance measures (non-GAAP measures). Furthermore, the standard adds specific guidance for aggregation and disaggregation of items in the financial statements and in the notes. The standard will encourage companies to avoid classifying items as ‘other’ (for example, other expenses), and using this classification will lead to additional disclosure requirements. The standard is effective from annual reporting periods beginning on or after 1 January  2027 with earlier application being permitted. The Group is examining the effects of the standard on its financial statements with no plans for early adoption. Use of estimates and judgments
	The preparation of financial statements in conformity with IFRS requires management of the Company to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.
	The judgment of management, when implementing the Group accounting policies and the basic assumptions utilized in the estimates that are bound up in uncertainties are consistent with those that were utilized to prepare the annual financial statements.

T42 IOT TRACKING SOLUTIONS PLC

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. Dollars in thousands

 

NOTE 3 -  SHARE CAPITAL
	a.	Composition : Ordinary shares of no-par value, issued and outstanding:
June 30                                   June 30 December 31 2026 2025 2025 Unaudited Unaudited Audited 73,155,753 65,626,357 65,626,357
	b.	A Company share grants to its holder voting rights, rights to receive dividends and rights to net assets upon dissolution.
	c.	Weighted average number of shares used for calculation of basic and diluted loss per share:
				June 30                              June 30				December 31
				2026		2025		2025
				Unaudited		Unaudited		Audited
				72,821,113		62,826,357		64,241,742

The following table lists the number of share options and warrants and the exercise prices of such during the current and prior reported period:

		Six months ended June 30, 2026				Year Ended December 31, 2025
		Unaudited				Audited
		Number of options and warrants		Weighted average exercise price		Number of options		Weighted average exercise price
		£				£
Share options & warrants outstanding beginning of period		17,970,806		0.097		7,584,014		0.156
Options & Warrants exercised during the period		-		-		-		-
Options & Warrants issued during the period (1)		1,550,000		0.0275		10,500,000		0.05
Options & Warrants expired during the period		-		-		(113,208)		0.10
Share options & warrants outstanding at end of period		19,520,806				17,970,806
Share options & warrants exercisable at end of period (2)		17,970,806		0.097		17,970,806		0.097

(1) See note 5(i)

(2) In addition, the Group also has two convertible loans, which can be converted as of June 30, 2026, into a maximum total amount of 95.6 million shares

T42 IOT TRACKING SOLUTIONS PLC

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. Dollars in thousands

NOTE 4 -			FAIR VALUE OF THE FINANCIAL INSTRUMENTS
	The table hereunder presents a reconciliation from the opening balance to the closing balance of financial instruments carried at fair value level 3 of the fair value hierarchy:
					Anti-dilution and Conversion components		Warrants		Total
		Balance as of January 1, 2026			221		28		249
		Finance expenses (income), net			23		19		42
		Balance as of June 30, 2026			244		47		291

		Anti-dilution and Conversion components		Warrants		Total
	Balance as of January 1, 2025	204		34		238
	Finance income, net	(204)		(25)		(229)
	Balance as of June 30, 2025	-		9		9

		Anti-dilution and Conversion components		Warrants		Total
	Balance as of January 1, 2025	204		34		238
	Additions during the year	336		-		336
	Finance expenses (income), net	(319)		(6)		(325)
	Balance as of December 31, 2025	221		28		249

The fair value of warrants was measured using the Black-Scholes model. The valuation as of June 30, 2026 was based on expected volatility of approximately 91% and a risk-free interest rate of approximately 4.1%.

The fair value of the anti-dilution and conversion component of the convertible loans was estimated using the residual value approach, under which the component's value approximates the loan amount less the fair value of the liability component.

T42 IOT TRACKING SOLUTIONS PLC

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. Dollars in thousands

NOTE 5 -		RELATED PARTIES
	a.		Mr. Avraham Hartmann who serves as a director and CEO and Mr. Uri Hartmann, a son of Mr. Avi Hartmann, who serves as non-Board CTO hold 6.07% and 4.20% of Company issued shares, respectively.
	b.		Current debit (credit) balances:	June 30					December 31
				2026			2025		2025
				Unaudited			Unaudited		Audited
			Debit (Credit) balance: Avi Hartmann Uri Hartmann	(37) (833)			(9) (686)		(10) (744)
			Total Credit balance (1)	(870)			(695)		(754)
			Loans: Uri Hartmann	(284)			(243)		(255)
			Total Loans	(284)			(243)		(255)
			Total balances, net	(1,154)			(938)		(1,009)
			(1) The effect of exchange rate changes on balances during the reporting period increased balances by $106K.

	c.	Transactions with related parties:	Six Months Ended June 30				Year Ended December 31
			2026		2025		2025
			Unaudited		Unaudited		Audited
		Total salaries and related expenses for Mr. Avi Hartmann and Mr. Uri Hartmann, including car maintenance and bonuses (1)	744		221		463
		Salaries and related expenses for Mr. Igor Vatenmacher, including car maintenance (2)	5		59		84
		Total share-based payment expenses	11		-		-
		Payment to Mr. Avi Hartmann's son for website maintenance	12		-		-
		Other Non-executive directors’ fees	54		49		100
		Interest to related parties	11		4		9
		The amount includes bonus expenses of $428K$ and 50K$ for Mr. Avi Hartmann and Mr. Uri Hartmann, respectively.     Since May 2025, Mr. Igor Vatenmacher has been a non-executive director. Until this date, he served as CFO.

T42 IOT TRACKING SOLUTIONS PLC

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. Dollars in thousands

NOTE 5 -		RELATED PARTIES (cont.)
	d.		At the Company’s AGM on June 11, 2026, shareholders approved certain matters in relation to director remuneration. Per the AGM approval, Mr. Avi Hartmann is entitled to a basic monthly salary of $18k, alongside benefits that include a company vehicle ($3.3k), a meal allowance ($1.3k), a mobile phone, statutory pension contributions, and an advanced study fund (Keren Hishtalmut). Mr. Hartmann is also entitled to 24 days of annual leave and the reimbursement of reasonable business expenses incurred in the performance of his duties. Subject to continued revenue growth and positive Group EBITDA for the first half of 2026 as confirmed in writing following review by the Group’s external auditors, his basic monthly salary will increase to $21.7k, effective September 1, 2026. Mr. Hartmann is also eligible for an EBITDA-linked annual bonus capped at $250k. The bonus is payable either in cash or through conversion into Company shares, at the sole and absolute discretion of the Remuneration Committee. The share conversion price is determined based on the average share price between the publication date of the annual consolidated financial statements and the actual share issuance date. Since the Company has no contractual obligation to settle the bonuses in cash, and the choice of settlement mechanism rests entirely with the Remuneration Committee, the bonus was recorded in the financial statement as an equity-settled share-based payment transaction. Under his new employment agreement, Mr. Hartmann's employment with the Company shall commences on January 1, 2026, and shall continue until his employment agreement is terminated in accordance with its provisions, but not prior to December 31, 2030.
	e.		Per the AGM approval, Mr. Avi Hartmann was granted a one-time bonus of $350k in recognition   his maintenance of ongoing client and supplier relationships and that Mr Hartmann has not received any increase in remuneration or bonus since the Company’s IPO in 2013. The bonus is payable in two tranches: $250k by 31 December 2026 and $100k by 31 December 2027. Payment will be made in cash or, at the election of the independent directors (excluding Mr. Hartmann), through the issuance of new ordinary shares in the Company. Any such shares will be priced by reference to the 5-day average share price prior to issuance and allotted no later than three months following the relevant tranche payment date. The bonus was recorded in the financial statement as an equity-settled share-based payment transaction.
	f.		Per the AGM approval, Mr. Uri Hartmann is entitled to a basic monthly salary of $15k, alongside benefits that include a company vehicle ($3.3k), meal allowance ($1.3k), a mobile phone, statutory pension contributions, and an advanced study fund (Keren Hishtalmut). He is also entitled to 24 days of annual leave and the reimbursement of reasonable business expenses incurred in the performance of his duties. Subject to continued revenue growth and positive Group EBITDA for the first half of 2026 as confirmed in writing following review by the Group’s external auditors, the basic monthly salary will increase to $18k, effective September 1, 2026. Mr. Hartmann is also eligible for annual bonus of $100k, subject to achieving performance objectives defined in advance. The settlement mechanism of Mr. Uri Hartmann's bonus is identical to that of Mr. Avi Hartmann; therefore, it was recorded in the financial statement as an equity-settled share-based payment. Under his new employment agreement, Mr. Hartmann's employment with the Company shall commence on January 1, 2026, and shall continue until his employment agreement is terminated in accordance with its provisions, but not prior to December 31, 2030.

T42 IOT TRACKING SOLUTIONS PLC

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. Dollars in thousands

NOTE 5 -		RELATED PARTIES (cont.)
	g.		Per the AGM approval, the interest rate on the outstanding loan from Mr. Uri Hartmann will increase from 4% to 8% per annum. As of January 1, 2026, the outstanding loan balance was $256k.
	h.		Following the approval of resolutions at the Annual General Meeting held on 5 January 2026 regarding conversion of outstanding remuneration owed to the Chairman and Mr. Martin Blair, Non-Executive Director, the Company issued 4,003,925 and 3,525,471 new ordinary shares to Mr. Rosenberg and Mr. Blair, respectively, on 9 January 2026. The shares were issued in lieu of a portion (approximately 76%) of their accrued remuneration, calculated at a price representing a premium of approximately 10% to the closing price of t42 ordinary shares on the trading day prior to the agreement, utilising the Company’s existing allotment authorities. Following this issuance, Mr. Rosenberg’s total holding increased to 6,561,294 ordinary shares and Mr. Blair’s holding increased to 4,093,892 ordinary shares, representing 9.0% and 5.6%, respectively, of the Company’s enlarged issued share capital.
	i.		Following shareholder approvals at the AGMs in January and June 2026, the Company granted options Company ("Options") to the following Directors and PDMRs:  Name Quantity Exercise price Vesting Period A. Hartmann (CEO) 250,000 2.5p 12 months A. Hartmann 250,000 3.0p 2 years, equally A. Hartmann 250,000 4.0p 3 years, equally U. Hartmann (CTO) 200,000 2.5p 12 months M. Rosenberg (Director) 75,000 2.5p 12 months M. Blair (Director) 75,000 2.5p 12 months A. Sabag (CFO) 150,000 2.5p 2 years, equally
			I. Vatenmacher (Director) 150,000 4.5p 12 months A. Sabag 150,000 4.0p 2 years, equally
			The fair value of the benefit associated with the grant of options amounted to $47K on the grant date and was estimated using the Black-Scholes model. The value of the benefit will be recognized as expense over the vesting Period of the options.

T42 IOT TRACKING SOLUTIONS PLC

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. Dollars in thousands

NOTE 6 -	COST OF REVENUES
			Six Months Ended June 30				Year Ended December 31
			2026		2025		2025
			Unaudited		Unaudited		Audited
	Purchases and manufacturing		1,584		891		2,789
	Communication Suppliers and Others		202		119		207
	Amortization		73		91		168
	Decrease in Inventory (*)		398		100		112
			2,257		1,201		3,276

(*) In H1 2026, the Company wrote off slow-moving inventories in an amount of $185K.

NOTE 7 -	NET FINANCE INCOME (EXPENSES)
			Six Months Ended June 30				Year Ended December 31
			2026		2025		2025
			Unaudited		Unaudited		Audited
	Exchange rate differences, net		(179)		(466)		(593)
	Changes in fair value of financial liabilities		(42)		229		325
	Bank charges		(24)		(26)		(58)
	Loans interest		(155)		(367)		(541)
	Interest to suppliers		-		(36)		(37)
	Interest to related parties		(11)		(4)		(9)
	Others, net		(19)		(24)		(35)
	Net finance expenses		(430)		(694)		(948)

T42 IOT TRACKING SOLUTIONS PLC

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. Dollars in thousands

NOTE 8 -

SEGMENTATION REPORTING

		The Group has two reportable segments: Hardware and SaaS, which form the Group's strategic business units.
		The accounting policy regarding segments reporting is as described in Note 25 to the annual financial statement

			Hardware		SaaS			Total
Six months ended 30.06.2026: (Unaudited)
Segment revenues			2,448		1,023			3,471
Cost of revenues			(2,147)		(110)			(2,257)
Gross profit			301		913			1,214
six months ended 30.06.2025: (Unaudited)
Segment revenues			1,321		972			2,293
Cost of revenues			(1,071)		(130)			(1,201)
Gross profit			250		842			1,092
Year Ended 31.12.2025: (Audited)
Segment revenues			4,060		2,040			6,100
Cost of revenues			(3,035)		(241)			(3,276)
Gross profit (Loss)			1,025		1,799			2,824

NOTE 9 -

SIGNIFICANT EVENTS AFTER THE REPORTED PERIOD     There were no significant events after the reporting period.

 

END